April 24, 2009
Part of being an entrepreneur is making mistakes.
You will hit walls. You will get lost. You will be unsure of how to proceed. When this happens, rethink your assumptions.
A good way to rethink your assumptions is to play the “what if” game.
The rules are simple, treat the scenarios as legitimate possibilities, and brainstorm your best way out. There is no “pass,” you must address each issue head on. And you must play with each of your core assumptions by turning them on their heads.
You’ll be surprised the ways you find to dramatically reduce costs, staffing needs, sales cycles, and funding requirements when you play this game.
Here are my top 3 favorite what-ifs to start with:
“What if we had to be profitable in 3 months?”
“What if we could only hire one developer?”
“What if no one wants to use the product, even if we give it away for free?”
If you challenge yourself to address these issues and put your assumptions to the test, you’ll be able to quickly react to any issue you face while simultaneously building backup plans for the future.
4 Comments | Advice, Entrepreneurship | Permalink
Posted by Seth Blank
April 17, 2009
In December of 2007, in Melbourne, Australia, I received a magical piece of advice. This simple but brilliant message has changed the way I communicate, do business, and live my life:
There will always be an infinite number of legitimate reasons people do not want to do what you ask of them. Your job is to show them the one reason they must.
The advice came from Dr. William Ardrey, who had just agreed to be the chairman of my new company, DBIX, as part of a conversation about raising investor capital. However, the advice stands on its own in just about every situation imaginable.
For investors there is no limit to the list of reasons for avoiding a deal: too much risk, issues with the term sheet, a more attractive alternative deal, the economy, unexpected personal developments, travel plans, even elective surgery. You cannot dismiss these concerns even if you disagree with them; they are legitimate to the investor.
Instead of spending all of your time and energy trying to dissuade concerns, focus on highlighting the key reason why they should care. Do your research. Find out what the investor is passionate about and tailor your pitch to resonate accordingly. If the opportunity is framed correctly, all other concerns melt away.
However, the point is not to blindly ignore all worries; the point is that you cannot possibly address them all. Pick and choose your major battles and focus on what’s most important: the clear and valuable reasons to proceed.
But this doesn’t stop with investor relations. Applying this advice to my own life has made me a happier and more successful person. Focusing on the reasons for doing something instead of the reasons against help me to make decisions that I am passionate and positive about. And it prevents me from making fear based decisions. When I’m passionate and fired up about the reasons behind my decisions, I remain motivated to follow them through to completion.
Focusing on the reasons to do something ensures happier decisions, stronger decisions, decisions which will be followed through. And they’ll seal the deal.
46 Comments | Advice, Investors, Raising Capital | Tagged: DBIX, duh, Investors, nofear, Raising Capital, really good advice, success, William Ardrey | Permalink
Posted by Seth Blank